Chalk up another legal victory for Entergy and Vermont Yankee

Entergy (NYSE:ETR) has fended off another legal attempt to force closure of its Vermont Yankee nuclear plant in a decision issued March 25 by the Vermont Supreme Court.

Vermont Yankee has been much-litigated.

Last June the U.S. Court of Appeals for the District of Columbia Circuit rejected a legal challenge to the Nuclear Regulatory Commission’s (NRC) issuance of a 20-year license renewal for the roughly 600-MW boiling water reactor (BWR).

In January 2012 U.S. District Court Judge J. Garvan Murtha ruled against the state’s effort to shutter Vermont Yankee, saying it infringed upon NRC’s turf under the Atomic Energy Act. The Murtha opinion also said Vermont’s argument about Vermont Yankee’s power contracts affected interstate commerce, which is also a federal issue.

An appeal of the Murtha decision was then heard by U.S. Court of Appeals for the Second Circuit two months ago. Various other legal actions are still pending. 

NEC sought closure through Vermont Supreme Court

In this case, the New England Coalition (NEC) had filed a complaint seeking to force subsidiaries Entergy Nuclear Vermont Yankee and Entergy Nuclear Operations to stop operating the plant. The coalition claimed Entergy was operating the unit in violation of the Public Service Board’s final order approving the 2002 sale of the power plant to Entergy.

“There are no grounds to grant equitable relief, and NEC’s complaint is therefore dismissed,” the Vermont Supreme Court held.

“NEC fails to demonstrate, as predicates for the injunctive relief sought, that it exhausted its administrative remedies and that it has no adequate legal remedy,” the Supreme Court held. “NEC has not requested, nor has the [Vermont Public Service] Board issued, an order directing Entergy to cease operating Vermont Yankee on the grounds advanced by NEC here.”

In 2006, following the Sale Order, Act 160 came into effect, ostensibly requiring state legislative approval before the Board could renew the Certificate of Public Good (CPG) authorizing continued operation of the plant past its scheduled expiration date of March 21, 2012.

“In 2008, Entergy applied to the Board to renew or amend its CPG, a proceeding now pending and underway.  Entergy filed a motion for a declaratory ruling with the Board in March 2012, asking the Board to order, among other things, that Entergy could continue operating Vermont Yankee while its petition for a new or amended CPG remained pending,” the court said in its ruling.

  “The Board reached a contrary conclusion, however, with respect to the 2002 Sale Order that had approved the sale of Vermont Yankee to Entergy,” the court said. “Condition 8 of that order prohibited Entergy from operating Vermont Yankee after March 21, 2012 absent “issuance” of a new or renewed CPG,” the court noted.

Absent modification of the Sale Order, the Board stated that the continued operation of Vermont Yankee after March 21, 2012 without a new or renewed certificate would violate the condition of that sale, the court said.

In the meantime, Entergy obtained an injunction from the United States District Court for Vermont against enforcement of the state legislative approval law based on federal preemption under the Atomic Energy Act. The federal injunction prohibited the Board from “bringing an enforcement action, or taking other action, to compel Vermont Yankee to shut down” after March 21, 2012 because it failed to obtain legislative approval for continued operation, according to the Vermont Supreme Court.

The Vermont Public Service Board, however, “indicated that it was not issuing an order directing Entergy to cease operations, but rather, it was responding to Entergy’s request for a declaratory ruling.  Entergy then moved to amend the Condition 8 deadline in the Sale Order under Vermont Rule of Civil Procedure 60(b), contending, essentially, that the legislative interjection into the licensing process was an unforeseen circumstance justifying modification of the deadline provision,” according to the Vermont Supreme Court. The Board denied the motion in November 2012. 

“In the instant complaint, NEC asserts that the Board correctly found that 3 V.S.A. § 814(b) does not excuse Entergy from complying with Condition 8 of the Sale Order.  Based on this assertion, it asks this Court to enforce the terms of the Sale Order and the terms of a Memorandum of Understanding (MOU) incorporated therein,” the state supreme court said.

NEC seeks to enjoin Entergy from continuing to operate Vermont Yankee until the Board has rendered a decision on Entergy’s application for a new or amended certificate of public good. But the Vermont high court said there were no grounds to grant relief.

The case “In re Investigation into General Order No. 45” is also listed as Vermont Supreme Court Docket No. 2012-448.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.